Parliament approval must for RBI COO post: Government

MUMBAI: The government has clarified that the central bank’s proposal to appoint a chief operating officer in the rank of deputy governor cannot be cleared until the Reserve Bank of India Act is amended.

An amendment to the Act requires Parliament’s approval and will also mean a political decision on the same.

The clarification was given by financial services secretary GS Sandhu while speaking on the sidelines of a real-estate banking conclave in Mumbai on Wednesday. It comes after RBI announced an internal restructuring plan, the broad contours of which were cleared by its board.

The proposals included appointment of a chief operating officer (COO) to head one of the five clusters the bank has proposed in the new internal structure. Nachiket Mor, who headed an RBI committee on improved financial access to the poor, was rumoured to be appointed as its COO.

The restructuring proposed is in line with the practices adopted by central banks globally. In March, the Bank of England announced an organisational recast, and creation of a COO post.

Sandhu, who also happens to be on the Reserve Bank of India board, was reported to have said last week that the central bank “is reorganising internally. After that, if they think there is requirement of a COO, they will send the proposal and the finance ministry will take a view”